Cost of Living Crisis: What Employers Are Doing and How You Can Adapt

For the past few months, headlines like the ones below have probably become familiar:

“UK food prices soar by fastest rate on record as cost of living crisis bites” – The Guardian

“Cost of living: Almost half of adults finding it difficult to afford their bills – with numbers rising” – Sky News

But just what does this cost-of-living crisis mean for you as an employee, and what kind of support can you expect from your employer in this economic climate?

Let’s start with some numbers

The next few years is shaping up to be a particularly challenging time for employees and employers alike, with recent predictions indicating that the cost of living crisis will hit its peak in early 2023. The latest reports from the Office of National Statistics show that 93% of adults in Great Britain noticed an increase in their cost of living in September and October 2022 in comparison to the same period last year. With inflation reaching 10.1% in September 2022, household incomes are not rising as quickly as prices for goods and services.

Source: Rising cost of living in the UK, a House of Commons Library Report (data from ONS/Public opinions and social trends, Great Britain: household finances, 14/10/2022)

While the current economic prospects seem bleak, it’s important to highlight some government initiatives such as the Energy Price Guarantee, the Energy Bill Support Scheme, council tax rebate and the fuel duty

Sources: Taken from  Rising cost of living in the UK, a House of Commons Library Report. Data from HM Treasury. The Growth Plan 2022, Table 4.1 and Table 4.2; HM Treasury. Spring Statement 2022, OBR. Economic and fiscal outlook – March 2022; supplementary table 3.11; Table 3.1; OBR. Fiscal risks and sustainability – July 2022, Box 3.3.

But how are employers responding?

Some employers have mobilised to support their employees through this crisis. The CIPD recently published a set of recommendations on how to help staff, including:

• Offering a cost-of-living bonus
• Reviewing financial well-being policies and benefits packages
• Considering the legal implications of employees wishing to undertake second jobs
• Additional training for managers to better support employees
• Encouraging dialogue and an inclusive environment

Charles Cotton, Senior Policy Advisor in Performance and Reward at the CIPD, says:

“Unfortunately, the cost-of-living crisis is likely to push more and more employees into in-work poverty. This, along with the competition for talent right now, should motivate all organisations to adopt a financial wellbeing policy or improve their existing one.”

Employers now have an even bigger responsibility to support their employees’ financial well-being and need to offer attractive and supportive benefits to candidates.

Although candidates have seen increased bargaining power due to phenomena like “The Great Resignation” and “quiet quitting” there are many considerations to consider when putting forward your requests or negotiating benefits. Here’s our expert advice as recruitment specialists:

Negotiating your salary

We recently ran a LinkedIn Poll asking the question: Do you feel you’re being paid what your worth? Perhaps, unsurprisingly, the top answer to our question was ‘no’ with 57%.

But, before you ask for a raise or promotion, make sure to back up your proposal with evidential facts, achievements, and most importantly, industry benchmarks. Platforms like LinkedIn and Glassdoor are great places to start, but your specialist recruitment consultant will have the most accurate view of your job market.

It’s equally as important not to ask for too much. While we’re all about knowing your worth, be mindful of not pricing yourself out of your market.

Hybrid working

There are several proven benefits to hybrid working. In addition to a better work-life balance, it can be a significant cost saver. Similarly, having the option of working from the office allows people to compare commuting costs to heating their homes for a whole day.

Remember to ask for a reasonable amount of flexibility, consider the sector you are in and the nature of your role. Explain your interest and show a willingness to find a middle point. For instance, you could offer a “trial period” of working remotely for 2 days a week, after which you can re-evaluate performance and how you are feeling.

Other benefits

Some employers offer additional benefits such as:

• Free meals or support with specific bills
• Discounts or expensing costs related to working from the office
• Salary sacrifice schemes
• Selling back unused annual leave

Remember that if needed, your employer might be able to offer money management advice and debt support – or at least redirect you to the right source of help. Make sure to consult with HR to see what the company offers.

Speak to a recruitment specialist

The cost-of-living crisis is here – fact. While these new initiatives demonstrate that some employers are taking proactive steps towards supporting employees, candidates should take note and consider how to guide their job search during this economic shift.

If you’re not sure where to start, our 20 years of experience in the recruitment industry can help you navigate your job search.  Get in touch with us today if you work in HR, finance or marketing to chat about your next steps.